U.S. banking regulators exempt small banks from swap rule

WASHINGTON (Reuters) - Regional banks are exempt from rules that have made it more difficult and costly for large lenders to hedge against a future interest rate shock and other risks, leading bank regulators said on Monday.

The Dodd-Frank financial reforms of 2010 required more derivatives such as swaps to move through a central clearinghouse. Swaps are commonly used to hedge against a sudden change in interest rates.

Banks with less than $10 billion in assets do not have to satisfy margin rules and other standards governing the use of such securities, the Federal Deposit Insurance Corporation, Federal Reserve and Office of the Comptroller of the Currency said in a release.

The Monday announcement largely ratifies an earlier version of the rule offered in November.